NEW YORK (Reuters) - Canada’s Come by Chance refinery, on the far eastern tip of the country, has swapped out its mainstay Iraqi crude to run almost wholly on U.S. shale oil, industry sources say, the latest sign of how the shale boom is redrawing global oil trade.

A seagoing barge is loaded with crude oil from the Eagle Ford Shale formation at the newly expanded crude dock at the Port of Corpus Christi, Texas, April 10, 2014. REUTERS/Darren Abate

Some two months after South Korea’s national energy firm agreed to sell the refinery to a newly formed New York-based commodities group, the 115,000-barrel-per-day (bpd) plant in Newfoundland has already begun making significant changes in its crude oil diet, according to two sources familiar with its operations, who spoke on condition of anonymity.

Today, the facility is running mainly on crude oil being shipped out of Texas, according to the sources as well as shipping data compiled by Thomson Reuters. That is a big switch from the first nine months of the year, when over 70 percent of its feedstock was coming from Iraq, data show.

The switch at Come by Chance - a town named for its remoteness on the island of Newfoundland - is the most dramatic sign yet of how a growing bounty of light, sweet U.S. shale oil is displacing other producers in refineries worldwide.

While rapidly rising North American production has already squeezed out imports across most of the U.S. Gulf and East coasts, and some of Canada, the Come by Chance refinery is the furthest-flung plant to make such a major switch, suggesting that cheaper domestic prices are compensating for higher freight costs.

The big shift in feedstock from generally sour Iraqi crude to light, sweet U.s. shale has not been entirely trouble-free, however. In the past few weeks, the facility has been running at anywhere between 90,000 and 105,000-bpd as it adjusts to the new slate, one of the sources said. Both of the sources said it was currently running at about 105,000 bpd, still below capacity.

Asked to confirm the switch from Iraqi crude oil to U.S. crudes at the Canadian refinery, a spokesman for the Korean National Oil Company, South Korea’s state-run oil company, said the incoming owners are now making those decisions. He said the deal was expected to close in November.

The new owners, SilverRange Financial Partners, a little known merchant bank run by two former senior Wall Street oil traders, also declined to comment, citing the pending sale.

That deal is expected to close “imminently,” a source said.

TANKERS FROM TEXAS

As part of the sale, the new owners negotiated a new supply and offtake agreement with BP Plc, ousting Australia’s Macquarie Bank Ltd, which had pioneered shipments of Texas shale oil all the way to Newfoundland several years ago.

But over the first nine months of this year, those shipments were intermittent. Imports of U.S. crude to Newfoundland and Labrador, whose only refinery is Come by Chance, came to around 20,000 bpd, or about 20 percent of the refinery’s intake, according to Statistics Canada trade data. By contrast, imports from Iraq averaged 73,000 bpd.

Since October, however, that appears to have shifted substantially.

According to vessel flow data analyzed by Thomson Reuters’ Freight Research & Forecasts, only four oil tankers have discharged about 2.25 million barrels of crude at Come by Chance since late September — all of them from Texas. That is an average rate of more than 100,000 bpd, five times the norm.

The last cargo from Iraq berthed in mid-August, the data show. From April through August, six tankers unloaded some 10 million barrels of Iraqi oil at the refinery — more than one tanker a month.

GOODBYE IRAQI SOUR?

The growing reliance on U.S. grades follows the announcement in September that a New York-based SilverRange, run by Neal Shear, former top commodities banker at Morgan Stanely, and ex-Lehman Brothers executive Kaushik Amin, were buying the aging refinery from KNOC.

It is unclear what, if any, contractual arrangements still exist between the refinery’s new operators and Iraq’s State Organization for Marketing of Oil (SOMO). Iraqi oil has been a mainstay at the plant for years, including the long period it was run by Swiss oil trader Vitol.

Officials at Iraq’s SOMO said they do not comment on commercial issues.

The switch is particularly notable because Iraq has done better in the U.S. market than many other foreign suppliers, such as Nigeria and Algeria.

U.S. imports from Iraq are running at around 380,000 bpd this year, down from nearly 500,000 bpd four years ago, according to U.S. government data. Imports from Nigeria, however, have fallen from over 1 million bpd to near zero.

The growing flow of U.S. crude up the Atlantic Coast - bypassing a number of Pennsylvania and New Jersey refiners who are getting their U.S. shale supplies via costly rail shipments - may stoke even more debate over the so-called “Jones Act”, a near century-old law that requires all vessels sailing between U.S. ports to use U.S.-build and -crewed ships.

U.S. refiners, such as PBF Energy are pressing Washington to ease the rules, which require them to use U.S. ships that can cost four times as much as shipping crude from Texas to Canada on a foreign-flagged tanker.

Exports of U.S. crude to Canada - which are largely exempted from a contentious ban on most foreign sales of domestic oil - have surged to record highs this year, reaching nearly 400,000 bpd this summer, up from around 70,000 bpd just two years ago. Exports dipped to about 280,000 bpd in September, according to Reuters calculations based on Census Bureau data on Tuesday.

Reporting by Jarrett Renshaw, additional reporting by Ahmed Rasheed in Baghdad and Meeyoung Cho in Seoul; Editing by Jonathan Leff and Tomasz Janowski